Mamo Mihretu, the Governor of the Ethiopian National Bank, in an interview with Fana Broadcasting Corporation Television aired on April 1, 2023, claimed that Ethiopia’s external debt stock is very small in comparison to other countries’ external debt stocks such as Kenya, Sudan, and South Africa.
He said “Ethiopia’s external debt is 28 billion USD. This is only 24% of the [Ethiopian] GDP. This is not a large amount [in comparison with other countries]. For instance, Kenya’s debt amounts to 70% of its GDP, South Africa’s is 70% of its GDP, Sudan’s is 181% of its GDP, and USA’s is over 115% of GDP.”
HaqCheck investigated the claim by the central bank governor, Mamo Mihretu.
The debt-to-GDP ratio or percentage of debt (external, domestic, or total) to GDP is obtained by dividing the debt by the GDP.
Is Ethiopia’s external debt 24% of the GDP?
Yes, it is 24.6% of the GDP.
According to the World Bank, Ethiopia’s GDP at the end of June 2021 was 111.27 billion US dollars.
The annual report of the 2021/22 fiscal year by the National Bank of Ethiopia indicates that Ethiopia’s GDP stood at 5.9 trillion Birr.
The Ethiopian National Bank in its 2021/22 fiscal year report stated that Ethiopia’s external public debt reached USD 27.9 billion which is 24.6% of the GDP [around 113.5 billion USD].
Is Kenya’s external debt 70% of its GDP?
No. It is 33.7% of its GDP.
The World Bank said that Kenya’s GDP at the end of June 2021 was 110.35 billion US dollars.
At the end of June 2021, Kenya’s external public debt was 4,290.7 billion Kenyan Shillings (39 billion USD, calculated using the average exchange rate), which is 50% of the country’s total public debt, according to the Central Bank of Kenya.
Recent reports indicate Kenya’s external debt amounts to 37.87 billion US dollars.
As of June 2022, the external debt of Kenya was 33.7% of its GDP, according to the National Treasury of Kenya. The country’s total public debt is 8.6 trillion Kenyan Shillings which is 67.3% of the GDP.
Thus, Kenya’s external debt does not amount to 70% of its GDP. Rather it is 33.7% of the GDP.
Is South Africa’s external debt 70% of its GDP?
No, it is 39.28% to 40% of the GDP.
South Africa’s external debt stood at 164.6 billion US dollars as of December 2022, according to the South African Reserve Bank, the country’s central bank.
There is no official data from the country’s government on the size of the South Africa’s GDP.
The World Bank and the International Monetary Fund (IMF) present two different figures regarding the South African GDP.
The World Bank says South Africa’s GDP was 419.02 billion US dollars in 2021.
The IMF stated that the GDP of South Africa was 411.48 billion US dollars in 2022.
The average between the figures from the World Bank and the IMF is 415.25 billion US dollars.
Thus, the external debt-to-GDP ratio is 39.6% if we calculate it using the average figure.
If we use both figures of the South African GDP, the percentage of the country’s external debt to its GDP is between 39.28 and 40%.
Is Sudan’s external debt 181% of its GDP?
No, it is 150% of the GDP.
The government of Sudan has not published any latest data regarding the country’s size of GDP.
The World Bank said that Sudan’s GDP in 2021 was 34.33 billion US dollars. But the data is old and we can’t use it in calculating the currency external debt-to-GDP ratio.
The International Monetary Fund (IMF) stated that the GDP of Sudan as of 2022 was 42.76 billion US dollars.
Sudan’s external debt has reached 64.16 billion US dollars as of June 2022, according to the Central Bank of Sudan.
Therefore, Sudan’s external debt is 150% of its GDP.
The governor of the National Bank of Ethiopia, Mamo Mihretu, MISLEADINGLY compared the external public debt of Ethiopia to the total public debt (domestic+external) of Kenya, South Africa, and Sudan.